Could BP have avoided the Gulf Oil Spill if it had more Women Executives?

How much has the paucity of women executives at BP and the overall gender imbalance in BP’s managerial ranks contributed to the Gulf Oil Spill?

I’m betting that had there been more women in the executive ranks at British Petroleum, more women (especially from inside the Company) on BP’s Board of Directors, and more women in company overall, the attitudes, behaviors and decisions at BP — the same ones that created the Gulf Oil Spill — might have been avoided.

You might dismiss this as a crude argument, and I’ll admit that the strokes connecting the variables are quite broad, but there is a sensible structure under-girding the suggestion. Let me rig it up for you.

The Situation at British Petroleum

Consider the situation at British Petroleum

– British Petroleum has historically failed to demonstrate a concern for worker safety and for the safety of the environment, despite their public relations campaigns to the contrary.

— The organization has failed to address the most serious potential mechanical risks, even through relatively small investments such as the $500,000 ‘kill switch” that could have stopped the current underwater oil geyser.

— BP has failed to protect workers’ safety through safe equipment and safety procedures.

— And, BP has consistently denied the technological risks and the environmental risks related to deep water drilling.

Overall, BP demonstrates inadequate skill and concern when it comes to safety & risk. It is unwilling or unable authentically to address environmental concerns related to its current and future business.

Women Managers, Pro-Environmental Attitudes and Greener Behaviors

Now, consider what women managers & executives might typically bring to the table.

• Women demonstrate a higher concern about the environment and demonstrate more pro-environmental behaviors (Dietz, et al., 2003)

• Responsible environmental practices are more important for women than for men when considering a potential employer. (Aspen Institute, 2008).

• Women MBA student are more like than men students to indicate that having a positive impact on society is an important criterion for their job choices. (Aspen Institute, 2008)

• Women managers make greener business decisions than male managers. (Hansa*GCR Greentech Report 2008)
  Check out this chart.

If there were more women executives, managers, and employees at BP, there would have been more concern for the environment, more pro-environmental behaviors, and more effort to make BP develop responsible environmental practices that would have a positive impact on society.

Further, more women managers would have meant that across a broad range of business decisions, more of these decisions would have been ‘green’.

Women: More Measured Risk Calculation, and More Risk-Sensitive Behavior

You’ve seen this research before, in the meme about whether more women in finance might have helped to avert or reduce the severity of the Wall Street, etc. financial crisis. So, I’ll only recap two points:

• Women managers make choices that are more sensitive to risk (risk-averse) than men (Charness and Gneezy, 2007).

• Women managers are less likely than men to be overconfident. (Barber and Odean, 2001)

Women managers are less likely than male managers to feel confident that even empirically-calculated, and empirically demonstrated potential risks can be ignored.

Women Executives and BP’s Commitment to Alternative Energy

The current head of BP’s Alternative Energy Division is Katrina Landis; perhaps she is making a difference within BP to make the organization more green and more risk-aware. However, just one year ago (June 2009) the highest-ranking woman executive at BP was Vivienne Cox. Cox ‘retired’ (at age 48?) the day before BPs current CEO Hayward shuttered the division, and slashed BP’s investment in alternative energy in half.

• What might Cox’s departure and the closing of the group suggests about how women executives and alternative energy are valued by BP’s C-suite?

• What might have happened if more women were at Cox’s level, and if more of these women were involved in BP’s core business?

Keep in Mind

What we call “gender differences” among managers are the result of cultural, political and occasionally biological differences between women and men. Women are not inherently or “essentially” more risk-sensitive or environmentally aware, but in our society women behave in ways that are more responsive to risk and more environmentally aware than men. These are not stereotypes, but empirically verified differences in stated preferences, priorities, and actions.

As with the “More Women on Wall Street” argument, many of the same caveats apply:

• Not every woman demonstrates the modal behaviors of women as a group.
• Not every woman in every organizational situation becomes an advocate for her own views when these contrast with those of the dominant view.
• Not every woman is able to influence the dominant values, system dynamics and overall situation in an organization.
• Saying that women will be more risk-aware, more safety conscious, and more environmentally active is not to dismiss the idea that some men will also be this way.
• Remember, too, that expectations about what makes ‘good’ leadership and defines success criteria are also gendered. “A woman who wants to rise to the top must suppress the very things that are supposed to change the existing culture,” writes the OpEd page of The Economist.

Also, while we’re at it:

— I’m not arguing that women should dominate or form the majority of BP executives.

— I am not arguing that ‘women are better than men’ …

Rather, Your Take-away Should Be:

(1) women managers behave differently regarding the environment and regarding risk,

(2) these differences are important, and

(3) increased representation of women / gender balance is a significant, under-appreciated strategy for getting more pro-environment, sustainability-focused, risk-sensitive leadership into organizations like British Petroleum.

It’s important for BP, and all organizations, to build businesses that are sustainable, and profitable, and valuable to society. Increasing the presence of women, throughout the organization and especially in key decision making posts, is a critical way to improve business and move us towards a better future.

There may be a unique opportunity now for the few women executives at BP as well as for women who want to become involved in energy businesses that actually move beyond petroleum and towards sustainability.

Research suggests that turbulent business environments, like the one at BP, may be just the place where women executives can ‘break through” gender-related barriers. Especially attractive women candidates will be those who demonstrate leadership styles and management skills that promote openness and inclusion, and facilitate innovation and large scale organizational change.

If British Petroleum is ever gets serious about developing a more sustainable, environmentally respectful business, one way to start is to hire and promote women — and men — who are committed to sustainability, who will make greener choices and –this is key — who will advocate effectively within BP for these values to guide the organization’s action.

Some posts about BP that you should read:

BP: Why can’t they say they are sorry and trying to make sure it will never happen again? Bob Sutton, Work Matters
Are you up for the challenge? BP’s careers tagline says it all Fran Melmed, Free-Range Communication

Chart of Gender Differences in Greener Corporate Behavior from (Hansa*GCR Greentech Report 2008)

Some References:

Aspen Institute, 2008. Where will they lead? MBA Student attitudes about business and Society. The Aspen Institute Center for Business Education.

Barber, B.M, Odean, T., 2001. “Boys Will Be Boys: Gender, Overconfidence, and Common Stock Investment”, Quarterly Journal of Economics 116, 261-292.

Beck, T., Behr, P.,Güttler, A. 2009. “Gender and Banking: Are Women Better Loan Officers?” CEPR Discussion Paper 7409.

Charness, G., Gneezy, U., 2007. “Strong Evidence for Gender Differences in Investment”, Working Paper.

Dietz, Thomas, Linda Kalof & Paul C. Stern.  2oo3. Gender, Values, and Environmentalism, Social Science Quarterly, Volume 83 Issue 1, Pages 353 – 364.

Dwyer, Peggy D., Gilkeson James H., & John A. List 2002. Gender differences in revealed risk taking: evidence from mutual fund investors, Economics Letters, Volume 76, Issue 2, Pages 151-158.

Momsen, Janet Henshall, 2000. Gender Differences in Environmental Concern and Perception. Journal of Geography, v99 n2 p47-56.

Tagged as: Aspen Institute, Bob Sutton, BP, British Petroleum, could women execs have avoided oil spill, empirical research on gender differences, Fran Melmed, gender differences, gender differences in green behavior, gender differences in management, MBA Attitiudes about Business & Society, Oil Spill, women and risk aversion, women and the financial crisis, women executives at British Petroleum, Women on Wall Street